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๐Ÿ‡ฎ๐Ÿ‡ฉ Indonesia /Economy & Trade

Economist Urges Data-Driven Surface Water Tax for Palm Oil Industry

From Republika · () Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

At a glance

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  • An economist suggests that the Surface Water Tax (PAP) for the palm oil industry needs accurate, verifiable data on water usage.
  • He advocates for improved measurement systems to enable local governments to set transparent taxes and provide certainty for companies.
  • The economist stresses that tax calculations should be based on actual water volumes used, not indirect indicators, and calls for certified measuring devices.

An economist from Riau University, Dr. Dahlan Tampubolon, has emphasized the need for accurate and verifiable data on water usage to support the imposition of the Surface Water Tax (PAP) on the palm oil industry. He argues that strengthening measurement systems is crucial for regional governments to set taxes transparently and offer certainty to companies.

Tampubolon stated that companies have a fundamental obligation to pay taxes, but the basis for these taxes must be clearly explained through measurable data on surface water utilization. "Local governments should not act like debt collectors who only bring bills without being able to explain where the figure came from," he said.

He further explained that the object of the PAP is the actual utilization of surface water. Therefore, tax calculations should refer to the volume of water genuinely extracted through pipes or pumps, rather than indirect indicators that do not accurately reflect water consumption. Tampubolon stressed the importance of regional governments possessing data on intake points, water flow rates, usage duration, and the purpose of water use to serve as the basis for calculating the Surface Water Revenue Value (NPAP).

The availability of accurate measuring tools and recording systems would help synchronize data between local governments and companies, ensuring that the determined tax amounts are traceable and verifiable. "If there are no water meters, data is not synchronized, and the calculation method is arbitrary, it will clearly become an arena for competing interests," he remarked.

Tampubolon urged regional governments to install certified flow meters to ensure water usage volumes are properly recorded. He also called for companies to be involved in the data recording and verification process, ensuring that the data used for tax determination is mutually confirmed. He believes that strengthening the measurement system will make PAP determination more quantifiable than relying solely on estimates, providing certainty for both government tax revenue and companies' tax obligations. "Fair tax is not just about having rules on paper, but about the transparency of calculations in the field," he concluded.

DistantNews Editorial

Originally published by Republika in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.